Turkey to finance businesses ahead of elections

Turkish government that has seen a decline in approval ratings ahead of next year’s elections due to country’s economic troubles, is preparing a treasury-backed financing package for businesses.

The package that will stand in line with Turkey’s economic model, aims to meet the financing needs of small and medium-sized enterprises, Treasury and Finance Minister Nureddin Nebati announced via social media on Wednesday.

Türkiye Ekonomi Modeli kapsamında bugüne kadar uygulamaya aldığımız destek paketleri, teminat eksikliği bulunan işletmelerimizin finansman ihtiyaçlarını karşılaması hususunda önemli bir işlev görmüştür.

— Dr.Nureddin NEBATİ???????? (@NureddinNebati) September 6, 2022

Turkish President Recep Tayyip Erdogan and his ruling Justice and Development Party (AKP) are facing presidential and parliamentary elections next year, amid a decline in public support. Erdogan government’s management of the economy, was seen as one of the main reasons for the loss of the support of electorate, according to the recent pollsters in Turkey.

Consumer price inflation rate skyrocketed to 80.2 percent in August, a record high level since 1998, the official data showed.

Turkish lira lost around 44 percent of its value in 2021, and a quarter more in the first half of this year, after the central bank cut interest rates to 14 percent from 19 percent late last year and kept them steady despite surging inflation until last month. In August, the central bank cut one-week repo rate further to 13 percent.

Erdogan insists on low interest rates, saying rate hikes are against his Islamic beliefs.